Harneys advises on the BVI FSC’s second successful admission to the Regulatory Sandbox

On 1 May 2022, Structure Financial commenced its participation in the British Virgin Islands Regulatory Sandbox, the second successful applicant approved by the BVI Financial Services Commission to date. Structure.fi is a global financial platform, which offers its mainstream audience mobile-first personal finance tools capable of transacting seamlessly across all asset classes. Founded in 2021, Structure.fi raised US$20 million from Polychain Capital and others to enable mainstream investors and traders to access DeFi opportunities, cryptocurrencies and traditional investment opportunities via a single mobile-first, user-friendly interface.

Structure.fi fits nicely within the category of technology innovation the BVI is seeking to encourage with its new framework and will offer its clients the ability to invest in tokenized stocks, options, cryptocurrencies and ETFs, 24 hours a day with zero commissions. Moreover, unlike platforms that require investors to execute multiple swaps to make their desired exchanges, Structure.fi’s users will be able to trade directly between any pair of assets in a single execution, and make and receive payments in the tokens of their choosing. Structure.fi is opening the product to a growing number of participants; obtaining real time feedback from users in order to bring a product to market that fulfils their commitment to create a platform that works for the broadest range of potential investors.

The Harneys team, spearheaded by Head of BVI Regulatory Ayana Hull and Senior Associate Kimberly Seagojo, led the transaction in its entirety and secured approval by the BVI FSC in early 2022.

Ayana commented: “We are delighted with this positive outcome and are very pleased that Structure.fi engaged us as their trusted advisor through the application and approval process. We also take this opportunity to congratulate their hardworking team and we wish them the very best during their participation as a BVI Sandbox applicant.”

The BVI Regulatory Sandbox was introduced in August 2020 by the BVI FSC with the core objectives of ensuring alignment between regulation and innovation, providing a testing environment, protecting market participants, and encouraging innovation through new business models participating in the jurisdiction. This tailored and focussed supervisory framework allows qualifying applicants to be able to test financial technology through the use of BVI companies. This removes the complexity of implementing existing regulatory framework whilst in a test phase but, importantly, has the supervision of the regulator to ensure good governance and appropriate regulation during the period

As the BVI pivots into this new and exciting direction to embrace and regulate the FinTech and crypto-currency industry, Harneys continues to assist their digitally focussed clients, who have made the BVI their jurisdiction of choice. Harneys is a leading BVI firm advising on all aspects of the digital assets offering. Their Regulatory and Corporate teams are poised to handle the wide spectrum of workflow including utility token issues, NFTs, crypto exchanges, tokenised debt and tokenised security offerings, SAFTS, service agreements, compliance, and sandboxing advice, amongst others. Harneys provides this advice against the backdrop of existing securities legislation, money services regulations, AML regulations, guidance from the FSC on the regulation of virtual assets in the BVI and the impending virtual asset service providers legislation, expected to come into force by the end of 2022.